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Talking Points:
- GBP/USD Technical Strategy: Flat
- Support: 1.4798, 1.4709, 1.4565
- Resistance: 1.4990, 1.5058, 1.5175
The British Pound moved higher against the US Dollar as expected after prices produced a bullish Piercing Line candlestick pattern. Near-term resistance is in the 1.4942-90 area (38.2% Fibonacci retracement, horizontal pivot), with a break above that on a daily closing basis exposing the 50% level at 1.5058. Alternatively, a turn below the 23.6% Fib at 1.4798 opens the door for a challenge of the 14.6% retracement at 1.4709.
Risk/reward considerations argue against entering long with prices in close proximity to resistance. On the other hand, the absence of a defined bearish reversal signal suggests taking up the short side is premature. We will remain flat for now, waiting for an actionable opportunity to present itself.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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